Reasons For Outsourcing In The United States

Outsourcing is the contracting of a business process by another party. Outsourcing sometime involves transferring employee and assets from one firm to another. It can be foreign or domestic contracting and sometimes involves moving a business to another country. Financial savings from lower international labor rates can provide the biggest motivation for outsourcing. Companies will outsource for many reasons. The first reason is time, theoretically no company has the time to take care of everything. Companies seek help from foreign companies to get the job done. Second is money, many companies use cost efficiency as a reason to outsource. The final reason is skills and knowledge. Outsourcing allows companies to bring skills required to run the organization from outside the company. In the 80’s U.S. factory workers began losing their jobs when American cooperation’s realized that they could manufacture their goods cheaper in a foreign country. One after another U.S. plants closed and moved overseas, leaving millions
of workers unemployed. Furthermore, in the 90’s the wide spread of the internet caused many white collar positions to go next as companies looked at saving money by firing expensive American employees and hiring foreign companies to manage various aspects of their business. Outsourcing is changing the face of the world. There are many big companies who outsource their business such as Apple, Nike, HB and many others. These companies chose locations where labor is really cheap such as China, India, Malaysia and the Philippines. For a company to outsource they need to partner with an outsourcing company. How does an outsourcing company work? Will use Apple as an example, Apple will trust an outsourcing company to help them hire and provide sales, services and support. In return Apple will ask for high sale results from the employees hired by the outsourcing company.

Although Outsourcing might seem like a good idea it places a negative effect on the American economy.
Outsourcing causes loss of jobs in America. Money and jobs sent to foreign country cause a disruption in the American economic system. In addition, outsourcing effects the government. Less taxes are collected from these product not to mention a decrease contribution to social security and Medicare. Finally, purchasing products overseas supports the inhuman treatment of foreign workers. In many harsh, dirty and unsafe work environments, foreign factory workers are not given the same labor laws standards we have in the United States. Furthermore, many of these factory workers are lucky to receive 600 dollars a month. As president, I would impose an increase tax on any American company outsourcing their business overseas. The tax would encourage companies to keep their operations in the United States creating jobs and supporting the American
economy.